• "President Bush sought to assure Palestinian Authority President Mahmoud Abbas" Thursday "that a peace agreement with Israel remains possible, as he began to accelerate his personal diplomacy in advance of his second trip to the Middle East this year," the Washington Post reports. "Bush met with Abbas at the White House amid pessimism in the region about the prospects for forging a deal to resolve the core issues that have divided the Israelis and Palestinians, including the borders of a Palestinian state and the status of Jerusalem."

• "From the right and the left," Bush "faces criticism over his approach toward North Korea after the White House belatedly disclosed U.S. intelligence findings that the communist regime was helping build a Syrian nuclear reactor -- at the same time it was promising to fully disclose its own nuclear activities," AP reports. "Both sides said the newly released intelligence raised the bar for making sure that any deal the U.S. and its partners make with North Korea's Kim Jong Il comes with a tough anti-cheating warranty."

• "The government's plan to crack down on illegal workers could cost employers more than $1 billion a year and legal workers billions in lost wages, a study commissioned by the U.S. Chamber of Commerce says," AP reports. "Those costs are enough to trigger a federal law that would require the Homeland Security Department to analyze more thoroughly the effect of its proposal, said Richard Belzer, a consultant hired by the chamber to do the study."

• "A project heralded as the dawning of an innovative, low-cost era in Navy shipbuilding has turned into a case study of how not to build a combat ship. The bill for the ship, being built by Lockheed Martin, has soared to $531 million, more than double the original, and by some calculations could be $100 million more. With an alternate General Dynamics prototype similarly struggling at an Alabama shipyard, the Navy last year temporarily suspended the entire program," the New York Times reports. "The program’s tribulations speak to what military experts say are profound shortcomings in the Pentagon’s acquisitions system."

• A "public-private face-off at West Point illustrates just what Bush envisioned when he proposed the 'competitive sourcing' initiative in 2001 as part of his management agenda. It turned on a simple idea: Force federal employees to compete for their jobs against private contractors and costs will decrease, even if the work ultimately stays in-house," the Washington Post reports. "But as Bush's presidency winds down, the program's critics say it has had disappointing results and shaken morale among the federal government's 1.8 million civil servants."

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• "A decade after Lasik eye surgery hit the market, patients left with fuzzy instead of clear vision are airing their grievances before federal health officials," AP reports. "So with a public hearing" today, "the FDA is beginning a new effort to determine if warnings about Lasik's risks are appropriate. The agency also is pairing with eye surgeons for a major study expected to enroll hundreds of Lasik patients to better understand who has bad outcomes and exactly what their complaints are."

• "The Bush administration regularly dismisses the idea of stepping in to prop up the housing market. Behind the scenes, a government agency is doing just that," the Wall Street Journal(subscription) reports. "Last year, the Federal Housing Administration's insurance fund paid $158.6 million in incentives to keep lenders from foreclosing on mortgages backed by the government."

Congress: WH 'Strongly Opposes' Dem Housing Plan

• "As they race toward clearing a housing stimulus measure, top Democrats are attempting to create the same environment that led to passage of the economic stimulus package," CongressDailyAM reports. "Spurred by a downturn in the housing market, Democrats are bidding high with hopes that, by placing some long-sought Bush administration priorities into the final mix, political momentum will surmount any opposition, especially from Senate Banking ranking member Richard Shelby [R-Ala.]."

• "A top housing official said Thursday that the Bush administration 'strongly opposes' Democrats' housing rescue package, calling it a bailout that would expose taxpayers to excessive risk," AP reports. "Deputy Secretary of Housing and Urban Development Roy A. Bernardi also indicated that" Bush "would veto a bill sending $15 billion to states for the purchase and rehabilitation of foreclosed properties."

• "Lawmakers cranked up pressure Thursday on the Bush administration to stop filling the nation's Strategic Petroleum Reserve amid growing election-year anxiety on Capitol Hill about high gasoline prices," the Wall Street Journal(subscription) reports. "Speaker of the House Nancy Pelosi (D., Calif.) called on President Bush to suspend filling the reserve, a move she said would directly lower the price of gasoline at the pump. She estimated it could take 5 cents to 24 cents off the price of a gallon of gas."

• "A proposed Delta-Northwest merger that would result in the world’s largest airline came under the congressional lens Thursday as skeptical lawmakers questioned the benefits of the $3.7 billion deal," The Hill reports. "Members in both chambers grilled the airlines’ CEOs one week after the two carriers announced they intended to join forces and one day after both posted losses totaling $10.5 billion for the first quarter of the year."

• "The United States is 'lurching toward a period of uncertainty and increased risk' in this election year and during the upcoming presidential transition, according to a new Congressional Research Service study that suggests counterterrorism responses that Congress, the Bush administration and its potential successors could take," the Washington Post reports.

• "The Senate Ethics Committee admonished Sen. Pete Domenici (N.M.) Thursday for contacting a U.S. attorney in his home state during a wide-ranging corruption probe, closing an investigation that clouded the Republican’s six-term Senate career," The Hill reports. "The light punishment came after the committee found 'no substantial evidence' that Domenici tried to influence attorney David Iglesias when he contacted him to inquire about the status of a 2006 investigation into corruption charges on a state Democratic official."

• "Sixty-three years after the end of World War II, an aging and dwindling group of Filipino veterans who fought alongside American forces against the Japanese is nearing victory in its long legislative battle for military benefits," the Los Angeles Times reports. "The Senate approved a measure Thursday that would expand benefits to those veterans, many of whom live in California. The House is expected to take up a similar measure before the end of the year."

• "Two senators have asked the Pentagon to reopen the investigation into Air Force officials' efforts to influence the award of a $50 million contract, urging investigators to focus on the actions of key service leaders, The Associated Press has learned. The chairman and the top Republican on the Senate Armed Services Committee have asked the Defense Department's inspector general to determine if there were any criminal or ethical violations or failures of leadership, particularly by senior Air Force officials."

• House Minority Leader John Boehner (Ohio) "said Thursday the Colombia Free Trade Agreement would be approved if" Pelosi "allowed a vote on the pact," CongressDailyAM reports. "'I believe there is a majority of the House of Representatives that are in favor of the Colombia Free Trade Agreement,' Boehner said at a news conference with Commerce Secretary" Carlos Gutierrez, Senate Minority Leader Mitch McConnell, R-Ky., "and other top Republicans. 'There is no reason the most democratic institution in the history of the world shouldn’t be allowed to have a vote.'"

Iraq: U.S. Discovers Iranian Weapons Caches

• "The U.S. military says it has found caches of newly made Iranian weapons in Iraq, leading senior officials to conclude Tehran is continuing to funnel armaments into Iraq despite its pledges to the contrary," the Wall Street Journal reports. "Officials in Washington and Baghdad said the purported Iranian mortars, rockets and explosives had date stamps indicating they were manufactured in the past two months."

• "Prime Minister Nouri al-Maliki said Thursday that the return of a Sunni political bloc that walked away from the government last year is imminent," the Washington Post reports. "The announcement followed a military campaign against Shiite militias that has buoyed Sunni politicians."

• "Iraq's government has kept thousands of dead, injured or absent policemen and soldiers on the payroll as a way to compensate or care for their families, an audit found," AP reports. "The practice is just one example of why there are no reliable numbers on how many Iraqi forces are on the job at any given time, says the report being made public" today "by Stuart Bowen, the special inspector general for Iraq reconstruction."

• "Iraq's former Deputy Prime Minister, Tariq Aziz, and other senior officials are to be tried over the deaths of a group of merchants, officials say," BBC News reports. "The men, who served under Saddam Hussein, will appear in court on 29 April, the officials say. They include Saddam Hussein's half-brother, Watban Ibrahim al-Hassan."

• "Federal officials on Thursday opened a path to temporary legal status for illegal immigrants whose spouses or parents died on 9/11, a step the families' supporters called a breakthrough in the effort to allow them to remain permanently in the United States," the New York Times reports. "Lawyers for the immigrants said a concession by Homeland Security officials would help to bring the family members out of the shadows."

• "Scores of Atlanta's law enforcement, transit and business leaders joined Mayor Shirley Franklin [D] on Thursday to urge Gov. Sonny Perdue [R] to veto a bill that would allow Georgians to carry concealed handguns onto trains and buses and into restaurants that serve alcohol," the Los Angeles Times reports.

• "Mothers from a polygamous sect described an emotional, rushed scene when they were forced from the shelter where they had been staying with their young children since the state removed them from their homes," AP reports. "Dozens of mothers were bused away from their children at the San Angelo Coliseum on Thursday after their legal efforts to stay united were rejected. Texas officials were preparing to move the last of the more than 400 children taken from the sect's ranch to group homes, shelters and residences, some hundreds of miles away, over the next few days."

• "The continued failure of Congress to approve a final version of the 2007 farm bill could adversely affect low-income families who rely on food stamps and other federal nutrition assistance as food prices continue their dramatic rise, according to food assistance and nutrition experts," the Chicago Tribune reports.

• "Spurred by visions of their cities frying in a warmer world, mayors around the nation have grasped a green solution: trees!" the Washington Post reports. "Like Johnny Appleseed, they have vowed to sow their seeds in great profusion, promising millions of new trees in the coming years. Arbor Day, that old fusty holiday, is getting a makeover."

Economy: High Energy Costs May Lead To Shut-Offs

• "Financial markets are starting to function more normally, banks are raising billions of dollars in capital, and the latest economic figures, while weak, aren't much weaker than had been expected," the Washington Post reports. "Taken together, these signs of stability make for the calmest economic period the nation has experienced in months. Now economists are grappling with whether the crisis will continue to ease, or whether this is merely the eye of the hurricane, with more big problems coming soon."

• "After struggling with soaring heating costs through the winter, millions of Americans are behind on electric and gas bills, and a record number of families could face energy shut-offs over the next two months, according to state energy officials and utilities around the country," the New York Times reports. "The escalating costs of heating oil, propane and kerosene, most commonly used in the Northeast, have posed the greatest burdens, officials say, but natural gas and electricity prices have also climbed at a time when low-end incomes are stagnant and prices have also jumped for food and gasoline."

• "A proposed $7 billion downtown Seattle project has become the latest major urban development to be scotched or delayed because of the credit crisis and a faltering economy," the Wall Street Journal reports. "Seattle's Clise family is pulling a 13-acre property for sale for at least $600 million off the market, at least temporarily. The property was intended to be the catalyst for a project that would have totaled the square footage of as many as five Empire State Buildings, putting it on the scale of London's Canary Wharf or the former World Trade Center in New York."

• Greenwich, Conn., "this wooded town of roughly 60,000 on Long Island Sound -- home to dozens of hedge funds, many millionaires and more than a few billionaires -- is one of the wealthiest enclaves in the country. But even Greenwich is not immune to the wave of home foreclosures sweeping the nation," the New York Times reports, looking at how the foreclosure crisis is hitting affluent Americans.

• "Microsoft Corp., whose Windows software dominates the personal-computer market, dropped as much as 5.7 percent in late trading after sales slumped, casting doubt on whether PC demand can hold up in a slowing economy," Bloomberg News reports. "The world's largest software maker reported a 24 percent drop in sales of Windows last quarter and forecast earnings that may miss analysts' estimates, breaking a streak of positive reports from Intel Corp. and Google Inc."

World: U.S. & Syria Spar Over Reactor

• "The Bush administration released detailed photographic images on Thursday to support its assertion that the building in Syria that Israel destroyed in an airstrike last year was a nuclear reactor constructed with years of help from North Korea," the New York Times reports. "The administration said it withheld the pictures for seven months out of fear that Syria could retaliate against Israel and start a broader war in the Middle East."

• "Syria accused the United States" today "of involvement in last year's Israeli attack on Syria that Washington said struck a suspected nuclear reactor built with North Korea's help," Reuters reports. "A Syrian statement said: 'The U.S. administration was apparently party to the execution' of the September raid by Israeli warplanes on eastern Syria. The statement did not give details. A U.S. official said on Thursday that Washington did not give Israel any 'green light' to strike the area."

• "Despite months of tension, Israel and Syria appeared Thursday to be engaged in indirect talks on the outlines of a peace accord that would include an Israeli pullout from the Golan Heights," the Los Angeles Times reports. "Direct, U.S.-brokered talks over the territory, captured by Israel in the 1967 Middle East War, collapsed in 2000. There have been periodic peace overtures since, but the current effort is viewed as more serious because it is being mediated by Turkey, which has close relations with both countries."

• "The top American envoy to Africa declared Thursday that Zimbabwe’s main opposition leader, Morgan Tsvangirai, was the 'clear victor' over President Robert Mugabe in the nation’s disputed election and called on other countries -- including the United States -- to help solve the deepening political and humanitarian crisis there," the New York Times reports. "The diplomat, Jendayi Frazer, the assistant secretary of state for African affairs, said the election results, based on projections by independent monitors, removed the rationale for any negotiated settlement that left Mr. Mugabe in charge."

• "A top Taliban leader in Pakistan with links to al-Qaeda has ordered his followers to stop attacking Pakistani forces in the country's troubled northwest region as he negotiates a deal with the new government to end months of political violence, according to Taliban and Pakistani officials," the Washington Post reports. "Baitullah Mehsud, who has been accused of masterminding the December assassination of former prime minister Benazir Bhutto, ordered the cease-fire as part of an agreement that calls for prisoner exchanges and a withdrawal of Pakistani military forces from areas near the Afghan border."

• "Acknowledging mistakes of both substance and image, President Nicolas Sarkozy on Thursday still vowed to accelerate his controversial program of systemic reform, arguing that France would sink in power and influence unless it changes its ways," the New York Times reports. "After a difficult and much-criticized year in power, Mr. Sarkozy answered questions on live television for an hour and 45 minutes, saying that he had been elected 'to rehabilitate work' in a country where 'salaries are too low and taxes are too high,' and 55 percent of the state budget goes to civil servants and pensions."

• "China, in an abrupt shift, announced that it will meet with representatives of the Dalai Lama, the Tibetan spiritual leader Beijing had accused of masterminding deadly antigovernment protests in Tibet," the Wall Street Journal(subscription) reports.

• "Sometime next week, a team of Chinese climbers now working its way up the Tibetan side of Mt. Everest will attempt to carry the Olympic torch to the peak's famed summit, one of the most anticipated stops on its round-the-world relay to Beijing," the Chicago Tribune reports. "Chinese authorities, intent on thwarting the kind of pro-Tibetan protests that have marred the torch's passage through cities like London, Paris and San Francisco, have closed the northern Tibetan side of the mountain to all climbing attempts this spring except their own."

• "The World Food Program appealed for hundreds of millions of dollars to cope with rising food prices that have sparked protests and food riots and led to bans on food exports in dozens of countries," AP reports. "Josette Sheeran, the WFP's executive director, said the U.N. agency is facing a 40 percent increase in the cost of food and requests for food aid from countries unable to cope with the rising prices."

Campaigns: Tar Heel Equation

Hillary Rodham Clinton isn't conceding North Carolina to Barack Obama, even though he has a 3-to-1 fundraising edge over her in the state. Earlybird's Campaign News section has details.